Skate wing with bacon at Tender Greens

Breakout Brands: Tender Greens

This is part of the 2013 NRN 50 special report, "Breakout Brands." This year NRN takes a look at 50 brands that are some of today's hottest emerging concepts. Meet the concepts shaking up the restaurant marketplace.

Tender Greens, a nine-unit “fast-fine” chain based in Los Angeles, is making a name for itself by offering a menu that is local, sustainable, chef-inspired and served over a counter.

At the same time, the brand is gaining attention by featuring dishes that offer better value than diners would necessarily find at fine-dining spots with table service, its owners say.

Tender Greens serves the kind of food customers would have “if they went to the farmers market or to Whole Foods and brought it home and cooked it themselves,” said Erik Oberholtzer, who co-founded the concept in 2006 with fellow chef Matt Lyman and David Dressler, a hotel and restaurant food and beverage director.

One of the chain’s popular dishes is tuna niçoise, featuring fresh tuna, greens, tomato, potato, green beans, capers and quail egg. The ingredients are sourced largely from a network of California food producers and prepared by chefs who learned their trade in luxury hotels and high-end restaurants. The dish is priced modestly at $11, like most Tender Greens items.

The concept’s counter-service format also eliminates tipping and makes Tender Greens more affordable while allowing the staff to concentrate on food quality.

“If I was to deliver [tuna niçoise] to the table with a waiter, I would be very comfortable charging $22 for it,” Oberholtzer said. “We look at Tender Greens as a chef-driven full-service restaurant without the full service.”

Restaurant trends analyst and Nation’s Restaurant News contributor Nancy Kruse of The Kruse Company in Atlanta noted that Tender Greens addresses the interests of “conscious” eaters who care about organic, locally grown ingredients.

“It’s a real point of differentiation versus the competition,” Kruse said. “At the same time, the bright flavors and use of authentic ethnic ingredients like green papaya, queso fresco and roasted fennel really broaden its appeal.”

While Tender Greens offers a core menu, individual chefs create their own seasonal specials and have the autonomy to develop supply lines for ingredients with local farmers.

Consequently, it is no surprise that the partners have a reputation for attracting and retaining talented chefs with entrepreneurial leanings. For example, Pete Balistreri, a Tender Greens executive chef in San Diego, created his own charcuterie brand with the encouragement of the partners. His salumi is offered throughout the chain and is also sold to other restaurants.

Similarly, the partners are sending another one of their chefs, who has a passion for home brewing, to brewing school, which could lead to a craft-beer label at Tender Greens.

With a healthy bottom line, good cash flow and a loyal local following, expansion beyond California beckons. However, wary of overhasty growth, the partners have passed up opportunities to take Tender Greens to areas like the Pacific Northwest, the East Coast and Texas, for now. Instead they will open five new units in California over the next year.

In the early stages of development, the partners and their friends and families chipped in to finance new stores. As the chain blossomed, they tapped private investors and Small Business Association financing. The next phase of expansion, slated to bring the chain up to 30 stores by 2016, will likely be financed more by debt than by equity, Oberholtzer said.

“We want to give up as little of the company as possible but still finance the growth that is reasonable,” he said.